At whose discretion will the Bombs Away Marketing Fund be spent?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
The Marketing Fund will be spent at Bombs Away Franchising's sole discretion, and Bombs Away Franchising has no fiduciary duty with regard to the Marketing Fund.
- (d) Contribution by Other Outlets.
Bombs Away Franchising is not obligated to (i) have all other Bombs Away businesses (whether owned by other franchisees or by Bombs Away Franchising or its affiliates) contribute to the Marketing Fund, or (ii) have other Bombs Away businesses that do contribute to the Marketing Fund contribute the same amount or at the same rate as Franchisee.
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, Bombs Away Franchising has sole discretion over how the Marketing Fund is spent. The FDD specifies that these expenditures don't need to be proportionate to a franchisee's contributions or provide any direct benefit to the franchisee. Bombs Away Franchising also states it has no fiduciary duty regarding the Marketing Fund.
This means that while franchisees contribute to the Marketing Fund, Bombs Away Franchising ultimately decides how those funds are allocated and spent. These expenditures can include advertising, promotions, sponsorships, brand development, website maintenance, social media, market research, and other related overhead expenses.
For a prospective Bombs Away franchisee, this highlights the importance of understanding that contributions to the Marketing Fund do not guarantee direct or proportional benefits to their specific franchise location. Franchisees should consider this when evaluating the overall costs and potential returns of investing in a Bombs Away franchise. They may want to inquire about Bombs Away Franchising's marketing strategies and how the Marketing Fund has been used in the past to better understand how their contributions might support the broader Bombs Away system.